Russia’s VimpelCom to buy Armenian operator for $436 mln

Russia’s VimpelCom to buy Armenian operator for $436 mln
19:42 | 03/ 11/ 2006
RIA Novosti, Russia
Nov 3 2006
MOSCOW, November 3 (RIA Novosti) – Russia’s second-largest mobile
operator, VimpelCom [RTS: VIMPG], has signed a deal with Greece’s
Hellenic Telecommunications Organization (HTO) to acquire 90% in
Armenia’s leading phone company Armentel for 341.9 million euros
($436 million), the company said Friday.
HTO bought Armentel in 1997 for $142.5 million and invested a total
of $300 million in the company.
Today, the company accounts for 40% of the Armenian telecommunications
market, operating in the GSM 900 and CDMA standards. Its client
base comprises about 600,000 fixed-line and 400,000 mobile service
subscribers. The company’s earnings in 2005 stood at 110 million euros
($140 million).
VimpelCom, which outpaced the Russian mobile market leader MTS
[RTS: MTSS] at the tender, undertakes to pay the Armenian company’s
liabilities, which amount to about 40 million euros ($51 million).
The deal is expected to be completed late this year, if the government
of the Caucasus state, which owns 10% in Armentel, approves it,
and other issues are settled.